Governor Nixon Vetoes Tax Cut Bill

(AP) – Gov. Jay Nixon has vetoed legislation that would have reduced Missouri’s income tax rates for the first time in more than 90 years.

The legislation vetoed Wednesday had been touted by the Republican-led Legislature as a way to keep Missouri economically competitive with neighbors such as Kansas and Oklahoma that have cut taxes.

But Nixon cited concern about an apparent mistake in the legislation that would have repealed an existing sales tax exemption on prescription medicine. The Democratic governor also has raised concern that the lost income tax revenues could hurt funding for education and mental health services.

The bill would have gradually reduced corporate and individual income tax rates while also creating a new deduction for business income reported on individual income taxes.